1 Which of the changes being considered by the manager of Quality Parts Company are counter to the lean philosophy? Quality Parts Company supplies gizmos for a com- puter manufacturer located a few miles away. The company pro- duces two different models of gizmos in production runs ranging from 100 to 300 units. The production flow of models X and Y is shown in Exhibit 12.12. Model Z requires milling as its first step, but other- wise follows the same flow pattern as X and Y. Skids can hold up to 20 gizmos at a time. Approximate times per unit by operation num- ber and equipment setup times are shown in Exhibit 12.13. Demand for gizmos from the computer company ranges between 125 and 175 per month, equally divided among X, Y, and Z. Subassembly builds up inventory early in the month to make certain that a buffer stock is always available. Raw materials and purchased parts for subassemblies each constitutes 40 percent of the manufacturing cost of a gizmo. Both categories of parts are multiple-sourced from about 80 vendors and are delivered at ran- dom times. (Gizmos have 40 different part numbers.) Scrap rates are about 10 percent at each operation, inventory tums twice yearly, employees are paid on a day rate, employee tumover is 25 percent per year, and net profit from operations is steady at 5 percent per year. Maintenance is performed as needed.